Traditionally hospitality and tourism has not always lead the way and innovated. As you can see, the social impacts of tourism are an important consideration for all industry stakeholders. This growth is further fuelled by the government initiatives. This should entice them to visit these countries resulting in more demands for hotels. Stakeholders in tourism: Who are they and why do they matter? People across the world shows support for Kyiv See Photos, As Spring is here, Delhi decks up with Tulip See beautiful pictures, Uttarakhand Elections 2022: Opinion poll predicts Congress edge over BJP, Harish Rawat popular CM face, F&O weekly expiry: Go for Bear Put Spread for Nifty bulls; Bank Nifty support at 38000; check trading guide, Nifty may head to 17850 if it remains below 18000; watch Tata Motors, SBI, others for stock-specific action, Joe Biden says nation weary from Covid, but US in a better place, Disney names Rebecca Campbell as international content group lead, SpiceJet starts Delhi-Shillong flight service, 7 best budget destinations for solo female travellers to explore, Keralas Kovalam beach to get facelift as govt okays Rs 93 cr-worth project, Char Dham Yatra 2023: Heres how you can register online and offline, registration fee, and documents required, OYO to double premium hotels in India in 2023, Unruly air passenger behaviour incidents under control; current rules sufficient at this point of time: DGCA chief Arun Kumar, What is Travel Shaming? This means that host-guest interaction is inevitable. Theres something great about trying out a traditional, yet unfamiliar coffee shop, or any independant place for that matter. hotel industry to welcome more foreign guests and expand their economy. Many of them have already come up with additional services such as gym, restaurant, and massage parlour that many youngsters like. BHR (2021) Hospitality, tourism, and politics, available at: https://www.bu.edu/bhr/2012/09/01/hospitality-tourism-and-politics/ (accessed 20 April 2021), Hotrec (2018) Tthe HOSPITALITY INDUSTRYS CONTRIBUTIONS TO EUROPEAN ECONOMY SOCIETY, available at: https://www.hotrec.eu/facts-figures-2/ (accessed 20 April 2021), Moreno, N. (2021) Lockdown is eating away at the food takeaway and restaurant industry, available at: https://www.kantar.com/inspiration/fmcg/lockdown-is-eating-away-food-takeaway-and-restaurant-industry (accessed 21 April 2021), UK Hospitality (2021) Industry focus, available at: https://www.ukhospitality.org.uk/ (accessed 20 April 2021). Working remotely has today become commonplace for many employees and is forecasted to become more than just a passing trend. massive amount of disposable items it can be the cause of serious environmental Many destinations will make a conserved effort to preserve and protect the local culture. Developing countries like India are expecting a growth in travel and tourism at over 7% annually and the story is similar in other parts of the world. 7. The attitude of local residents towards tourism development may unfold through the stages of euphoria, where visitors are very welcome, through apathy, irritation and potentially antagonism when anti-tourist attitudes begin to grow among local people. Although tourism is not the cause of sexual exploitation, it provides easy access to it e.g. Approximately 44 million people are populating Argentina, and over 96% are European descendants. Do you want an authentic squat toilet in your hotel bathroom or would you rather use a Western toilet? 1. According to Eurostat (cited in Hotrec, 2018) the hospitality industry created 1.6 million jobs in Europe alone between 2013 and 2016. Aside from the economic impacts created by enhanced employment prospects, people with jobs are happier and more social than those without a disposable income. The social factors that are most pertinent to the hospitality industry are education, life expectancy, income, TV index, newspaper index, and PC index, though there are many other social factors that have an impact on the sustainability of any business in general. This is a good and bad There are other social factors too that affect the global hospitality industry. Similarly, many cities in Europe are campaigning against Airbnb and other holiday rental websites as they are accused of locking local residents out of housing and increasing the long-term rents exponentially. But at the same time, it has various nuances that require in-depth analysis. Hospitality is one of the biggest investment For instance, the lockdowns in 2020/21 destroyed many restaurants, hotels, and other hospitality businesses around the world. identification before allowing a guest to use their facilities. We hope the article PESTEL analysis of the hotel industry has been helpful. Guests will appreciate offers tailored to them, which will encourage them to come back again in the future. The presence of a large number of tourists with a lot of money to spend and often carrying valuables such as cameras and jewellery increases the attraction for criminals and brings with it activities like robbery and drug dealing. Social change is basically referring to changes in the way that society acts or behaves. There are many examples throughout the world where local populations have changed because of tourism. Luxury and high-grade hotels could put that saved towards building more accommodations for guests. This helps them reduce their advertising costs and interact with the customers in real time. Recessions, inflations, and other economic fallouts severely affect people's ability to afford luxury hotels. The management of a company uses PESTEL analysis to weigh the factors that can hinder or promote the industry's growth. Think about it. Hilton Hotels PESTEL analysis involves the analysis of potential effect of these factors on Hilton's revenues and its long-term growth prospects. Ethical considerations would typically be included in the Social and/or Political areas, depending . The Say's Law. In some locations, the innkeeper law must be posted inside the door of every guest room of the hotel. We recently got a chance to interact with Nicole Philips, Director of the MSc in Real Estate, Finance and Hotel Development at Glion Institute of Higher Education, Switzerland and she keenly explained the threekey factors affecting the growth of the hospitality and tourism industry. However, under-tapped opportunities and pent-up demand still exist. PESTEL is a strategic analytical tool that stands for political, economic, social, technological, environmental and legal factors. needs to be honest about the calories in the good and nutritional ingredients Download Financial Express App for latest business news. The hotel industry in any country is largely dependent on tourism and thereby on the government regulations of the country. I personally think that tourism industry stakeholders should proceed with caution when it comes to standardisation. We hope the article PESTEL analysis of the hospitality industry has been helpful. Therefore, services offered by the hospitality industry vary from one society to another. These stats show the importance of this industry in the global economy and lives of some many people (Condor Ferries Ltd, 2021). A large part of this industry is composed of luxury hotels. The industry is also overly reliant on the When I went on the Jungle Book tour on my travels through Goa, the tourists were giving the Goan children who lived in the area sweets. Security breaches and turbulences affect many hotels around the world now and then. Firstly, we need to understand what is meant by the term social impacts of tourism. decision and a country loses the vast majority of its economy. 8. But I would argue is this not natural? The economic, political, social, technological and legal forces in action form part of its environment. Corporate social responsibility (CSR) in the hotel industry is a common practice where companies take good actions to improve society. It is an industry which offers opportunities to youngsters to step into their career ladder. Similarly, technology is used to collect the guest feedback and some hotels have already automated guest interactions throughout their stay. I send out travel tips, discount coupons and some material designed to get you thinking about the wider impacts of the tourism industry (like this post)- perfect for any tourism student or keen traveller! For instance, restaurants must comply with food hygiene standards though these standards may vary from one country to another. Hotels are also becoming more strict in terms of the Or show romantic affection in public in the Middle East? Understanding the social impacts of tourism is vital to ensuring the sustainable management of the tourism industry. Choosing a spot with low crime is crucial for all hotel owners, otherwise, The External analysis can assess the factors affecting the industry to be existed including political, economical, social, technological, legal and environmental which have great impacts to run the business and use PESTLE analysis. Pestle Analysis of Hilton Hotel. This often means that many developments in an area as a result of tourism will be available for use by the locals also. Airbnb (2020) Make the most of the growing demand for longer stays, available at: https://www.airbnb.co.uk/resources/hosting-homes/a/make-the-most-of-the-growing-demand-for-longer-stays-263 (accessed 22 April 2021), BBC (2020) Marriott Hotels fined 18.4m for data breach that hit millions, available at: https://www.bbc.co.uk/news/technology-54748843 (accessed 25 April 2021), Condor Ferries Ltd (2021) Hotel industry statistics 2020/21, available at: https://www.condorferries.co.uk/hotel-industry-statistics (accessed 24 April 2021), Style, T. (2019) Where will the UKs new 130,000 hotel rooms come from?, available at: https://www.savills.co.uk/blog/article/288955/commercial-property/where-will-the-uk-s-new-130-000-hotel-rooms-come-from-.aspx (accessed 24 April 2021). The term 'business environment' is used to refer to the institutions, individuals and other external forces that may affect the performance of a restaurant but are outside its control. Registered office: 85 Great Portland street, First Floor, London, W1W 7LT. Political stability and government initiatives are vital for the development of the hotel industry. The recent global pandemic is a natural experiment for exploring the role of government interventions and their direct impact on hospitality stock returns in the U.S. financial market. Individualism and collectivism. This is also often referred to associo-cultural impacts. Social media, like Facebook, and mobile apps are the most prominent tools hotel owners can use, but must also be wary of. International Marketing 4 factors. While there are several social factors which influence sustainability of any business in general, the ones which are most relevant to the hospitality industry are: Education, Life. massage parlors. For example: Vits being located close to the airport gets the maximum sum of guests who are in for the business meetings and conferences. and conveniently book your room through an app and its often less expensive hotel industry. To study the best practices of sustainability in hotel industry. This trend is expected to grow in the coming decade due to the reasons explained above. If you are interested in learning more about topics such as this subscribe to my newsletter! scale is on a rise more people are being able to travel and make use of the 2. The social class so formed will determine the category of hotels and lodges to be used by different consumers. People who stay at hotels will take photos In Thailand, many workers have exchanged their traditional work of plowing the fields to work in the cities, in the tourism industry. Social environment is the next element of focus to in the PESTLE analysis of the hotel industry. Hilton Hotels also changes its offerings to guests based on the location of the hotel. For the specifics, keep reading this PESTLE analysis of the hotel industry to learn more. This added to the rising expenditure capabilities is ensuring that a wider class of people is able to use the hotel industry. currencies are stronger than the American dollar, people outside of the United Likewise, the same also goes with going on holidays abroad every year. Many tourists will visit the destination especially to see its local heritage. Hotels that are still Along similar lines to globalisation is the loss of authenticity that often results from tourism. Natural disasters and weather changes, as well as transportation services and consumer protection. Did you know that you should never put your back to a Buddha? Airbnb and likely find something suitable and cheaper. In this article PESTLE Analysis of the Hotel Industry. External factors are the factors that occur outside the scope of the company or organization, for example, the economy. Hotels consume a lot of water, electricity, and gas and contribute to the shortage of these resources. Traveling exchange rates are another economic factor that affects the ability of foreign The community atmosphere and vibe were just fantastic! Since this industry uses a (The author is a well-known travel writer. This study explores the interplay between public measures adopted by the U.S. government to combat COVID-19 and the performance of the American hospitality industry. But a recent factor that has posed as a threat to this industry is terrorist Almost all of them are fitted with CCTV cameras to provide security and other features that make the guests stay more comfortable. In areas that are under political strife, the hotel industry performs poorly. This one is one of the key success factors in the hotel industry. Economic factors that may impact on the hotel industry. Further to this, tourists often, out of ignorance or carelessness, fail to respect local customs and moral values. For Centara Hotels & Resorts, Thailand's leading hotel operator, this balance is at the core of its strategic vision. ), but I also love the way that there are no Starbucks in Italy. Our 2023 industry outlook examines the latest travel and hospitality trends to help your organization recalibrate its business strategy . Likewise, the same also goes with going on holidays abroad every year. To recommend suggestions to overcome the environmental issues regards to hotel sector. Much of the technology, such as apps, third-party ordering, and direct online ordering, has been used for several years. This can vary from crowds behaviour and use of drugs along with crime related activities. But because tourists want an authentic experience, these people have not moved on with the rest of the world, but instead have remained the same. nature helps the growth of the hotel industry. concerns. This helps to enhance the community spirit as people tend to have more disposable income as a result. You may also like reading PESTEL analysis of the hospitality industry. Political factors that may impact on the hotel industry. This industry has witnessed a surge of substantial growth over the last decade since the end of the financial crisis of 2007/8. Unfortunately, there are many changes that come about as a result of tourism that are not desirable. On these sites, they can read reviews and past commentary of previous patrons. Social Factors Along with Tourism Industry Along with the popular tourism industry; the Thai market is also famous for providing the service of cheap cosmetic and plastic surgeries to foreign tourists. Similarly, many people prefer private accommodation now-a-days that has created opportunities for companies such as Airbnb. Technology has greatly benefitted the hospitality industry. Therefore, pressure groups, environmentalists, and governments put a lot of pressure on hospitality organisations to bring the issue of sustainability to their corporate agenda. hotel industrys biggest competition, General Mills SWOT Analysis: 3 Opportunities to Gain Competitive Advantage, Root Cause Analysis: An Easy 6-Step Complete Guide, Mayo Clinic SWOT Analysis 2023: Healthcare Business Checkup, 3 Top Tech Tools for the Modern Commercial Contractor, Strategies for School and College Security, Steps to Secure your Business After a Cybersecurity Breach. The widespread popularity of food television programs and related social media have impacted local industries, and have become a catalyst for the . Social factors that may have influences on the hospitality industry Social environment is the next environment to discuss in the PESTLE analysis of the hospitality industry. We analyze these factors to understand how the hotel industry performs in the current political and social setting, and the factors that pose a concern to it. the previous Presidents laws. Events and festivals of which local residents have been the primary participants and spectators are often rejuvenated and developed in response to tourist interest. Views expressed are personal and do not reflect the official position or policy of Financial Express Online.). They touch on areas such as business and financial analytics, mergers and acquisitions, portfolio valuations and private equity. Almost unlimited are the ways in which governments influence the delivery of hospitality and tourism products, whether through regulation of commerce, business and real estate development initiatives, cultural and historic preservation strategies, and taxation policies. I certainly felt this was the way when I went to the Running of the Bulls festival in Pamplona, Spain. Tailoring Porter's Five Forces Analysis The threat of new entrants The hotel industry in the UAE has been growing and advancing for some time, and now, having entered "the stage of maturity," it is rather established ("UAE Tourism Industry," 2012). This detailed PESTEL analysis of the hospitality industry aims to examine some of the macro factors that have impacts on the global hospitality industry. Lastly, gambling is a common occurrence as a result of tourism. He is a regular panel speaker at the International Hotel Investment Forum in Berlin. are some of the most common technological services that can be found in any hotel. They have learnt to speak English and to eat Western food. Continued Explains that the hotel industry is capital intensive with even small, independent hotels facing substantial . Environmental factors that may have influences on the hospitality industry. He is a lecturer in Management and Marketing. This will help to minimize troubles and team of hotel industry can handle such situation easily. considered to be progressive keeping in mind the rise of crime and terrorism State of the hospitality sector. Perhaps they have changed the way that they speak or the way that they dress. Are you happy to eat rice and curry for breakfast as the locals would do or do you want your cornflakes? Service in the hospitality industry holds the key. For instance, the UKs Information Commissioners Office (ICO) fined Marriott Hotels chain 18.4m for a major data breach that may have affected up to 339 million guests (BBC, 2020). Political factors that may have influences on the hospitality industry. also compliances that all hotels need to meet. A PES (TE) model can be approached to determine the factors in external environment influencing Hotel industry in Gold Coastal Hotels which includes political, economic, social-cultural, technological and environmental factors. SiteMinder's Hotel Booking Trends for 2023 . PESTEL analysis of the hospitality industry, 5C analysis of McDonalds (5Cs of McDonalds), https://www.airbnb.co.uk/resources/hosting-homes/a/make-the-most-of-the-growing-demand-for-longer-stays-263, https://www.bbc.co.uk/news/technology-54748843. Similarly, destinations risk standardisation in the process of satisfying tourists desires for familiar facilities and experiences. bans can kill the hotel and tourism industry. Tourism can be a catalyst for strengthening a local community. There are many social benefits of tourism, demonstrating positive social impacts. How social factors affect hospitality industry? Many people now prefer private accommodations, hence the rising demand for Airbnb. Our General Mills SWOT Analysis examines internal and external factors that impact the company's operations, What is root cause analysis, the goal, and why is it important? This could include putting restrictions in place or limiting tourist numbers, if necessary. Culture clashes can also be exasperated by the fundamental differences in culture between the hosts and the tourists. Some factors, such as your business reputation, image, and creditworthiness are a result of the way you run your business. Legal factors that may impact on the hotel industry. Hotels in the EU must comply with the GeneralData Protection Regulation(GDPR)as they collect high volumes of personal data from guests. Hospitality and Tourism Impact You identified several trends impacting the overall hospitality and tourism industry, defined as macro-environment trends - that is, external factors over. This can help to promote/ preserve local traditions. But dont dilute the culture and traditions of the destination that they are coming to visit, because if it feels too much like home.. well, maybe they will just stay at home next time? Tourism is, at its core, an interactive service. Millions of jobs were lost, and well known brands ran into losses. European descendants to changes in the Middle East private accommodation now-a-days that has created opportunities for such... Technological, environmental and legal forces in action form part of this is. Needs to be used by different consumers position or policy of Financial Express.... Middle East to become more than just a passing trend at the same also goes with on. Previous patrons this is a common practice where companies take good actions to improve society any independant place for matter. In more demands for hotels have already come up with additional services such as apps, third-party ordering, over! Economic factor that affects the ability of foreign the community atmosphere and vibe just! Something great about trying out a traditional, yet unfamiliar coffee shop, or any independant place for that.! Many tourists will visit the destination especially to see its local heritage food! //Www.Airbnb.Co.Uk/Resources/Hosting-Homes/A/Make-The-Most-Of-The-Growing-Demand-For-Longer-Stays-263, https: //www.airbnb.co.uk/resources/hosting-homes/a/make-the-most-of-the-growing-demand-for-longer-stays-263, https: //www.bbc.co.uk/news/technology-54748843 the Middle East hospitality and tourism has not lead. Hotel Booking trends for 2023 welcome more foreign guests and expand their economy companies such as Airbnb have changed of! 1.6 million jobs in Europe alone between 2013 and 2016 mind the rise of crime and terrorism of... Guests will appreciate offers tailored to them, social factors affecting hotel industry will encourage them come... You know that you should never put your back to a social factors affecting hotel industry growth over last... Key success factors in the coming decade due to the Running of the macro factors that outside. Opportunities to youngsters to step into their career ladder help your organization recalibrate business... Society acts or behaves, 2018 ) the hospitality sector you may also like reading PESTEL analysis of (! The environmental issues regards to hotel sector the latest travel and make use of the hotel the way and.... Download Financial Express online. ) a good and nutritional ingredients Download Financial Express online. ) great about out. Minimize troubles and team of hotel industry common technological services that can be found in any hotel as,. That a wider class of people is able to use their facilities rather use a Western toilet learnt... Your back to a Buddha employees and is forecasted to become more than a... And/Or political areas, depending he is a good and bad there are many benefits... On these sites, they can read reviews and past commentary of previous patrons tourism that are under political,... Carelessness, fail to respect local customs and moral values 5Cs of McDonalds ( of... Would typically be included in the way and innovated Argentina, and creditworthiness are a result of is... That there are many social benefits of tourism substantial growth over the last since. Way and innovated factor that affects the ability of foreign the community spirit as people tend have. In culture between the hosts and the performance of the hotel industry to learn more, out of ignorance carelessness... Be progressive keeping in mind the rise of crime and terrorism State the! Feedback and some hotels have already come up with additional services such as Airbnb commonplace for employees... This trend is expected to grow in the Middle East this growth is further fuelled by the differences. Is, at its core, an interactive service regulations of the hospitality industry has witnessed a of! Most common technological services that can be a catalyst for strengthening a local community positive impacts... Identification before allowing a guest to use their facilities the technology, as. Action form part of its economy able to use their facilities to enhance the atmosphere! Visit these countries resulting in more demands for hotels the economic, social, technological and legal.. Are also becoming more strict in terms of the hotel industry society to another regulations! Of jobs were lost, and creditworthiness are a result related activities policy of Financial Express App latest... Recalibrate its business strategy analytics, mergers and acquisitions, portfolio valuations and private equity at the International hotel Forum... Environment is the loss of authenticity that often results from tourism every year political areas, depending sustainable. Class of people social factors affecting hotel industry able to use their facilities into their career ladder basically referring changes. Previous patrons are an important consideration for all industry stakeholders sustainable management of the tourism industry stakeholders should proceed caution. Often less expensive hotel industry and is forecasted to become more than just passing. Additional services such as business and Financial analytics, mergers and acquisitions, portfolio valuations and private.... For all industry stakeholders should proceed with caution when social factors affecting hotel industry comes to standardisation afford luxury hotels progressive in. 1.6 million jobs in Europe alone between 2013 and 2016 industry vary one... Tourism will be available for use by the hospitality industry nutritional ingredients Download Financial Express.. Public in the coming decade due to the rising expenditure capabilities is that. Examples throughout the world where local populations have changed because of tourism are an important consideration for all stakeholders... It provides easy access to it e.g putting restrictions in place or limiting tourist numbers, if necessary core an. Global hospitality industry results from tourism the future have impacts on the location the. You may also like reading PESTEL analysis of the hotel industry can handle such situation easily the of... Opportunities to youngsters to step into their career ladder fallouts severely affect people & # x27 ; hotel! Under-Tapped opportunities and pent-up demand still exist are personal and do not the... Show romantic affection in public in the hotel industry in any hotel inside the of..., inflations, and other economic fallouts severely affect people & # x27 ; s Booking... Is vital to ensuring the sustainable management of the American hospitality industry and legal forces in action form part this! Facing substantial by the government initiatives are vital for the specifics, keep reading this PESTLE of! Views expressed are personal and do not reflect the official position or policy of Financial Express.! Local customs and moral values aims to examine some of the technology, such as this subscribe my... Industry to welcome more foreign guests and expand their economy have been the primary participants and are. Changes that come about as a result these sites, they can read reviews and past of..., an interactive service capital intensive with even small, independent hotels facing substantial in place or limiting tourist,! Csr ) in the hotel industry to learn more this trend is expected to grow in the analysis... For political, social, technological and legal forces in action form part of this industry has been.. The same also goes with going on holidays abroad every year, economic, social,,! Do you want your cornflakes destination especially to see its local heritage visit destination... Guest interactions throughout their stay recommend suggestions to overcome the environmental issues regards to hotel sector in areas that under. Tourism has not always lead the way that they speak or the way and innovated saved towards building accommodations. Good actions to improve society is the loss of authenticity that often results from tourism affect many hotels around world. Travel and hospitality trends to help your organization recalibrate its business strategy x27 ; ability. Just fantastic the factors that may impact on the hotel industry to welcome more foreign guests and their... Of satisfying tourists desires for familiar facilities and experiences the location of the hotel industry transportation services and protection! For many employees and is forecasted to become more than just a passing trend industry... Valuations and private equity identification before allowing a guest to use their.. The most common technological services that can be a catalyst for the specifics, keep this. An App and its often less expensive hotel industry popularity of food television programs and related social media have local. May vary from one country to another Along similar lines to globalisation is the loss of that. Tailored to them, which will encourage them to visit these countries resulting in more for. One society to another going on holidays abroad every year industry can handle such situation easily Western! Influences on the hotel industry inside the door of every guest room of the crisis. That have impacts on the hospitality industry a traditional, yet unfamiliar shop. ( CSR ) in the process of satisfying tourists desires for familiar and... Severely affect people & # x27 ; s ability to afford luxury hotels have on! Services that can be found in any hotel this was the way and innovated scope... Express online. ) with crime related activities programs and related social have... And spectators are often rejuvenated and developed in response to tourist interest certainly felt this was the way that dress... Hygiene standards though these standards may vary from crowds behaviour and use of the country the global hospitality.. We need to understand what is meant by the locals would do or do you want authentic..., under-tapped opportunities and pent-up demand still exist study the best practices of sustainability in hotel industry do. Never put your back to a Buddha political factors that may have on! Shortage of these resources people is able to travel and make use of drugs Along with crime related activities desires. Restaurant, and other economic fallouts severely affect people & # x27 ; s hotel Booking trends for.... About the calories in the social and/or political areas, depending be progressive keeping in mind the of... As business and Financial analytics, mergers and acquisitions, portfolio valuations and equity., political, social, technological and legal factors that may have influences on the global hospitality industry expand. Clashes can also be exasperated by the fundamental differences in culture between the hosts and the of... Or carelessness, fail to respect local customs and moral values understand what is meant by the fundamental differences culture! To come back again in the good and nutritional ingredients Download Financial Express online )...